Oberweis Dairy, which filed for Chapter 11 bankruptcy protection earlier this month, announced Tuesday that it has found a buyer for its century-old family business.
Brian Boomsma, owner of Chicago-based Dutch Farms, made a stalking horse bid for nearly all of the operating assets of the company, with plans to “operate and grow the business” when it emerges from bankruptcy, Adam Kraber, president of Oberweis, said in a news release.
“We are thrilled to have a business leader like Brian Boomsma interested in investing in Oberweis and enabling the company to continue to move forward and prosper,” Kraber said. “We continue to be grateful to our loyal customers, vendors, and committed employees who have supported us through this process.”
A Dutch Farms representative confirmed the bid Tuesday, but declined further comment. No details about the offer were disclosed by either company.
Oberweis Dairy filed for Chapter 11 bankruptcy protection April 12 in Chicago after initially failing to find a buyer to rescue it from financial distress. The dairy, which has been losing money in recent years, owes more than $4 million to its 20 largest unsecured creditors and about $14 million in secured bank debt, according to bankruptcy filings.
The company, known for its old-school bottled milk and ice cream, has 40 dairy stores in Chicago, Indiana, Michigan and St. Louis, grocery distribution and home delivery service. It outsources some manufacturing but has a 27-year-old plant at its North Aurora headquarters.
Started in 1915 by Peter Oberweis, an Aurora dairy farmer, the family-owned business grew from a single horse-drawn wagon to a multistate enterprise with $95 million in revenues last year. But Oberweis Dairy has struggled in recent years due to increasing consumer demand for dairy alternatives such as plant-based milk, as well as “improvident” capital expenditures, according to the bankruptcy filing.
After four generations in family hands, Jim Oberweis, a Republican politician and grandson of the company founder, made the decision to sell the dairy last year.
Oberweis Dairy notified the state earlier this month that it may lay off 127 workers at the family-owned North Aurora dairy June 11 because of a plant closure, but made clear in a statement to the Tribune that the layoffs may not occur if a buyer is found.
As a stalking horse bidder, the Dutch Farms owner set a minimum agreed price to buy the Oberweis Dairy assets, but left the door open to a higher offer. Oberweis Dairy said in its news release it expects to complete the reorganization process and emerge from bankruptcy under a new owner in late June.
Founded in 1987 by brothers Brian and Bruce Boomsma, Dutch Farms remains a family-owned business whose branded offerings include cheese, eggs, milk, butter and other dairy products.
rchannick@chicagotribune.com
